Solutioneers Consulting, Ltd. v. Gulf Greyhound Partners, Ltd.

237 S.W.3d 379, 2007 WL 2386358
CourtCourt of Appeals of Texas
DecidedOctober 18, 2007
Docket14-06-00032-CV
StatusPublished
Cited by81 cases

This text of 237 S.W.3d 379 (Solutioneers Consulting, Ltd. v. Gulf Greyhound Partners, Ltd.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Solutioneers Consulting, Ltd. v. Gulf Greyhound Partners, Ltd., 237 S.W.3d 379, 2007 WL 2386358 (Tex. Ct. App. 2007).

Opinion

OPINION

LESLIE B. YATES, Justice.

In four issues, appellants Solutioneers Consulting, Ltd. (“Solutioneers”), Tom Haynes, and T & S Haynes Enterprises, LLC d/b/a Mission Control (“Mission Control”) challenge the sufficiency of the evidence supporting the jury’s findings in favor of Gulf Greyhound Partners, Ltd. (“GGP”) for fraud and breach of contract. We affirm in part and reverse and render in part.

I.Background

This appeal involves a series of transactions between Haynes, his two advertising companies, Mission Control 1 and Solutio-neers, and the companies’ client, GGP, which operates a racetrack in Galveston County, Texas. Haynes owns and serves as general partner of Mission Control, an advertising agency that purchases advertising time from various media outlets for clients. Haynes also owns Solutioneers, an advertising company whose business consists largely of obtaining corporate sponsorships for clients. As described in further detail below, GGP entered into independent agreements with Mission Control and Solutioneers to obtain advertising for and sponsorship of its racetrack operations, and events relating to these agreements gave rise to the causes of action in this appeal.

A. Mission Control

In December 1999, GGP and Mission Control entered into an agency contract in which Mission Control 2 agreed, as agent of record, to purchase advertising time on GGP’s behalf in return for commissions. Charlie Fenwick, GGP’s director of marketing, testified that GGP enlisted Mission Control to alleviate the burden of conducting marketing operations in-house, which requires constant communication with media outlets and a large volume of paperwork. Under the agreement, Mission Control would purchase advertising time 3 for GGP as follows: (1) Mission Control would select and agree to purchase time from a media outlet, (2) the outlet would send an invoice to Mission Control reflecting the amount due for the time, (3) Mission Control would forward a “master” invoice to GGP, which included the amount due for the time plus Mission Control’s commission, (4) GGP would pay Mission Control the entire amount on the master invoice within ten to fourteen days of receipt, and (5) Mission Control would de *382 duct amounts for its commission and then forward the difference to the outlet as payment for the time. According to Fen-wick, GGP expected Mission Control to forward payment to the media outlet immediately upon receipt of payment from GGP.

As early as January 2001, GGP began receiving calls from media outlets complaining that GGP had not paid invoices for advertising time Mission Control had purchased. Fenwick contacted Haynes about the complaints; Haynes assured Fenwick the invoices had been paid, that the outlets were mistaken, and that his employees would investigate the situation. Fenwick testified that after these initial complaints, the problem went away, as GGP did not hear anything further from the media outlet or Haynes, and GGP continued to pay invoices based on Haynes’s assurances. However, as the year progressed, GGP received similar phone calls from a growing number of outlets. Eventually, in June 2001, after GGP made further inquiries about the situation, Haynes set up a meeting with Fenwick. At the meeting, Haynes and his employee, Aldie Beard, disclosed that Mission Control failed to forward $154,000 4 to media outlets for time that Mission Control had placed for GGP, producing detailed documentation of the delinquent accounts. Haynes admitted he used these funds to pay off debts to other media outlets because his “businesses” were experiencing financial difficulty.

Thereafter, Fenwick, Barry Sevedge, who is Fenwick’s boss and GGP’s general manager, and another representative in GGP’s corporate office held several meetings amongst themselves and with Haynes to determine the most efficient method to resolve the outstanding debt while salvaging GGP’s business reputation. As a result of these meetings, GGP directed the media outlets to send all future invoices directly to GGP and stated that GGP would now pay them directly. Further, Haynes agreed to help GGP negotiate with the outlets to either release or reduce the outstanding debt in return for promises of future advertising purchases from GGP, and the parties agreed Mission Control would still receive commissions on future business it obtained in these negotiations. GGP decided not to sever ties and pursue legal action against Haynes and Mission Control immediately because Haynes, who enjoyed closer, long-term relationships with many of the media outlets and had more information regarding the accounts in default, could serve as an intermediary and more effectively negotiate down the debt than could GGP alone.

Although GGP and Haynes successfully obtained debt releases from most of the media outlets by promising future business, some outlets refused, leaving $56,000 in unreleased debt. Therefore, to avoid damage to its credit, GGP paid $56,000 to these remaining outlets, which GGP considered a “double” payment in that it had once already transmitted funds to Mission Control to purchase this time. Sevedge testified that he considered the $56,000 double payment a loan to Mission Control and that GGP never released Mission Control from liability for repayment, though he explained that he and Haynes failed to negotiate a firm schedule for repayment, despite repeated attempts. Sevedge further noted that, in addition to repaying the $56,000, GGP initially paid Haynes and *383 his employees commissions in excess of that originally agreed, in the hope that Mission Control could continue business and would become able to repay the loan in the future. Haynes, on the other hand, understood that Mission Control had no obligation to repay the $56,000, claiming Sevedge told him it was a “cost of doing business.” On July 10, 2002, after repeated failures to settle on a repayment schedule, GGP terminated its relationship with Haynes and his companies, including Mission Control. Mission Control never repaid the $56,000.

B. Solutioneers

In February 2001, before GGP fully learned of Mission Control’s failure to pay the media outlets, GGP entered into a contract with Solutioneers in which Soluti-oneers agreed to obtain sponsorships for the racetrack in return for commissions. Under the agreement, Solutioneers would receive commissions both for obtaining new sponsorships and for enhancing the value of existing sponsorships. As with the original Mission Control agreement, the contract provided that Solutioneers would collect payments directly from the sponsors and remit GGP’s share within seven days of receipt.

Thereafter, Solutioneers, through negotiations conducted by Haynes, enhanced the value of an existing sponsorship agreement GGP held with Miller Brewing Company (“Miller”) from $50,000 to $75,000 per year for a two-year period. In 2002, Miller made the yearly payment in two equal installments of $37,500, one in the spring and one in the fall. Solutioneers received the spring payment on May 29, 2002, but failed to remit to GGP its share until July 5, 2002.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Thomas v. Hughes
27 F.4th 995 (Fifth Circuit, 2022)
Greg Mungas v. Odyssey Space Research, LLC
Court of Appeals of Texas, 2021
Hong v. Havey
551 S.W.3d 875 (Court of Appeals of Texas, 2018)
TecLogistics, Inc. and Josephine Treurnie v. Dresser-Rand Group, Inc.
527 S.W.3d 589 (Court of Appeals of Texas, 2017)
Viajes Gerpa, S.A. v. Fazeli
522 S.W.3d 524 (Court of Appeals of Texas, 2016)
Tan Duc USA v. Jimmy Tran
Court of Appeals of Texas, 2015

Cite This Page — Counsel Stack

Bluebook (online)
237 S.W.3d 379, 2007 WL 2386358, Counsel Stack Legal Research, https://law.counselstack.com/opinion/solutioneers-consulting-ltd-v-gulf-greyhound-partners-ltd-texapp-2007.